• Total value of all the goods and services produced by an economic system in a one-year period. USA has the highest real GNP of any industrial nation in the world.
• Real GNP. It is the gross national product adjusted fro inflations and changes in the value of a country’s currency.
• GNP per capita. The calculation of a nation’s per capita GNP takes into consideration that nation’s population.
• A rise in the gross national product of an economy from one year to the next year would indicate economic growth of that economy.
• Productivity. The ratio of output and input. It compares what a system produces with the resources needed to produce it.
• Improved productivity means the economy can grow more rapidly without triggering inflation.
• Balance of trade. Difference between a country’s exports to and import from other countries.
• Balance may be positive and negative.
• National debt. Total amount that a nation owes its creditors.
• Budget deficit. It is a situation in which government body spends more money in one year that it takes in. Budget deficit has created national debt.
• Popular ways to reduce budget deficit are:
• Raises taxes
• Reduce public spending.
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